Illinois asks federal government for Medicaid flexibility

SPRINGFIELD, Ill. (AP) — The state of Illinois is seeking permission from the federal government to use Medicaid funding to pay for mental health and substance abuse services that usually aren’t covered under the health insurance program for those living in poverty.

The Southern Illinoisan reports that Gov. Bruce Rauner’s administration is seeking a five-year waiver from certain Medicaid rules as part of its proposed “health and human services transformation.”

The plan aims to give services to Illinois’ most vulnerable residents more cost-effectively and efficiently by focusing on community-based programs, cooperation among state agencies, preventative care and public health.

“The way that we’re spending our scarce resources now is not producing outcomes that are good for the citizens of Illinois, and we need to do something about that,” James Dimas, secretary of the state Department of Human Services, said Thursday at a public hearing on the proposal in Springfield. “We have for decades overrelied on deep-end institutional care, and that has prevented us having the resources that were needed to invest in community-based and preventive care.”

The waiver would allow the state to test new ways of giving services to Medicaid recipients with mental illness and substance abuse problems. It wouldn’t increase the amount of federal funding the state receives or expand eligibility.

Under the state’s proposal, Medicaid money could be used to pay for services such as supportive housing for people with mental illness, job support for people with substance abuse problems, and certain medication-based addiction treatments for inmates nearing release from state prison.

State officials believe the proposal would work in concert with new state laws aimed at combating opioid addiction. The proposal would provide Medicaid recipients with substance abuse problems are short-term residential treatment, case management, withdrawal management and recovery coaching.

Felicia Norwood, director of the Illinois Department of Healthcare and Family Services, said it will take some time for the state to implement the changes if and when the federal government approves the waiver. Pending federal approval, the changes would be effective July 1.